A new credit rating agency designed to address the needs of sovereign borrowers in Africa, and led by an African Union (AU) Commissioner, is on track to be launched in 2025, according to a senior AU official. A rating agency essentially assesses the ability of organizations to meet their financial obligations. The official aim of the new agency is to offer a “more tailored” and “fair” credit ratings for African nations to address high borrowing costs and lack of global rating system representation. The assessment will provide an independent risk analysis that potential investors can use when deciding whether to invest in assets. The idea for an African credit rating agency was first floated in 2017, following numerous complaints by African governments regarding the conduct of the “big three” international ratings agencies — Moody’s, Fitch, and S&P in particular.

Source: The North Africa Journal July 26, 2024 00:04 UTC